Terrace settles former employees suit for $587,500

MOUNTLAKE TERRACE -- The city of Mountlake Terrace will pay $587,500 to settle a lawsuit filed by the police chief's former confidential secretary, who alleged that city officials conspired to have her fired after she gave damaging testimony in another lawsuit against the city.The settlement with former police administrative secretary Martha Karl comes after the city paid nearly $1 million in 2009 to settle a suit filed by former police Sgt. Jonathan Wender, who was fired in 2005 purportedly for dishonesty. Wender sued and, relying heavily on the testimony of Karl and others, alleged Assistant Chief Charles "Pete" Caw and others targeted him because he publicly favored decriminalization of marijuana.In her suit, Karl alleged she was transferred, demoted and then fired because of testimony she provided in depositions in Wender's lawsuit. Karl said the city had violated her First Amendment protections.Details of Karl's settlement agreement were not contained in the federal court docket. City officials declined to discuss it. The Seattle Times obtained a copy through a public-disclosure request. The settlement contains a nondisclosure clause in which Karl and city officials agree not to "disparage" one another and not to "discuss the settlement with the media."The city also has agreed not to seek reimbursement for $53,113 in city unemployment benefits Karl was paid after she was fired. And the city agreed to rehire her for a day so she could officially resign.City Attorney Greg Schrag referred to a portion of the agreement stating that the settlement "is not to be construed as an admission of liability" and that the "payments herein do not constitute any admission of wrongful conduct by the city of Mountlake Terrace."

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